Electrical Engineering and Electronics Industry

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Electrical Engineering
and Electronics
Industry
The electrical engineering and electronics industry has been shaped by
a long-standing tradition and remains one of the most dynamic sectors
of the Czech economy. Its position within the manufacturing industry has
been continually strengthened, mainly in relation to the long-time growth
of coherent sectors, such as the automotive industry, energy and construction. The EE/electronics industry and the automotive and plastic industries
are the main driving forces of the Czech economy. Their competitiveness
has been constantly rising, mainly due to new technologies used in production. The production volume as well as the trade balance have grown.
In 2007, revenues from sales of products and services in the electrical
engineering and electronics industry amounted to CZK 527 billion, which
represents a share of 15.5% of revenue in the whole manufacturing
industry in the Czech Republic. The electrical engineering and electronic
industry ranks third in total revenue following metallurgy and transport
engineering.
The Japanese company Panasonic supplemented its production of LCDs
with a research and development department focused on electronic and
mechanical solutions and software. The Danish company Bang & Olufsen
launched its production in Kopřivnice together with an R&D facility,
the first of its kind outside Denmark. The leading European chipmaker,
STMicroelectronics, runs the biggest individual IC design group in the CEE
region, focusing on state-of-the-art analogue/mix signal design. The international company ON Semiconductor, continuing the tradition of Tesla,
also operates, apart from manufacturing, two new product development
centres focused on the development of new technologies for the production of integrated circuits. Brno hosts one of the fastest growing design
centres of Flextronics and AMI Semiconductors and is truly a hub of electron microscopy in the CEE region with three world class-companies – FEI,
TESCAN and Delong Instruments - conducting research and manufacturing
in this high-tech field.
The high level of technical education, together with the strategic position
of the Czech Republic, has attracted numerous foreign investors at the
turn of the millennium, which have greatly contributed to a fundamental
restructuring of the production base, stabilisation of the sector, an increase
in work productivity and quality of production and expansion abroad.
Several strong foreign companies have already set up their R&D centres
and others intend to do so. For example, the Honeywell Company established a technological centre in Prague in 1993 in close cooperation with
the Czech Technical University. Its positive experience led the company
to set up a global R&D centre in Prague and an
engineering centre in Brno.
Direct foreign investments in the period from 1997 to 2007 in the EE/electronic industry have exceeded CZK 150 billion. The EE/electronic industry
accounts for 30% of the total volume of FDI in the Czech Republic and
holds second position after the automotive sector. The Czech Republic
has become the number one producer of computers in the Central Europe,
due, for example, to the Taiwanese investor Foxconn CZ, whose production
facilities are located in Pardubice and Kutná Hora and which has become
Structure of the EE/electronics industry in 2007
n Heavy-current electrical engineering
n Computer technology
n AV engineering, electronic components
n Instrument and automation devices
Source: Czech and Moravian Electrical
and Electronic Association
44%
24%
21%
11%
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Electrical
Engineering
and Electronics
Industry
the second largest exporter in the CR. It is mainly due to Panasonic, which
has produced televisions in Pilsen for over 10 years and now to Žatec
in the Triangle industrial zone that the Czech Republic has become
the number one European producer of LCDs.
Heavy-current electrical engineering accounts for the highest share of
revenue within the whole sector (44%), followed by computer technology
(24%), radio and television technology (21%) and instruments and
automation equipment (11%).
Manufacturing of heavy-current electrical products has a stable position
in the structure of the Czech electrical engineering industry, mainly due to
a long tradition and the extensive experience of the workforce. The main
products have traditionally included electric motors, generators and transformers, electric distribution and switching devices, cables and insulated
wires. The foreign investments in the automotive industry have contributed
to the fact that the range of electrical industry products has been
extended to include electrical equipment for the automotive industry.
Technical products and services meeting the world standards
are mainly sold to the countries of the European Union.
Czech Trade Promotion Agency
Head Office
Dittrichova 21, Prague 2
Czech Republic
[email protected]
www.czechtradeoffices.com
Foreign owners of large manufacturing facilities have undertaken the
necessary modernisations of technologies, improved the organisation
of production and established new business relations. Siemens provides
a good example of a successful entry of a foreign investor. Siemens
operates two production facilities and has become one of the biggest
employers in the Czech Republic.
Due to the favourable investment climate, the ongoing interest of foreign
investors, a highly qualified workforce with still relatively low labour costs
and advantageous conditions for the development of technological and
business support services centres, the electrical engineering and electronic
industry is expected to continue growing in the coming years.
Position of the EE/electronics industry
with the manufacturing industry
(revenues for sales of own products and services)
n Production of vehicles
n Production of electric and optical device
n Production of metal and metal-working products
n Production of machinery and equipment
n Food and tobacco industry
n Rubber and plastic industry
n Chemical and pharmaceutical industry
n Others
17.9%
16.4%
14.8%
10.1%
9.2%
6.4%
5.8%
19.4%
Source: Czech Statistical Office, Ministry of Industry and Trade
Czech and Moravian Electrical and Electronic Association http://www.electroindustry.cz
Czech Exporters Directory http://exporters.czechtrade.cz/en